Fed officials are worried about the inflation impacts from Trump’s policies, minutes show

Federal Reserve officials expressed concerns about inflation and uncertainty surrounding President-elect Donald Trump’s proposed policies, including tariffs, deregulation, and immigration changes, at their December meeting. Cautioning against rapid interest rate cuts, the Federal Open Market Committee (FOMC) lowered its benchmark rate to 4.25%-4.5% and signaled a slower pace of future cuts, aiming for a neutral policy stance.
While inflation remains above the Fed’s 2% target, strong consumer spending and a stable labor market support cautious easing. Officials emphasized that future actions will depend on economic data, projecting inflation to stabilize at 2% by 2027 and suggesting gradual rate adjustments through 2026.